Jan. 4 (Bloomberg) -- Leaders of the House Oversight and
Government Reform Committee are questioning a settlement pending
between U.S. banking regulators and mortgage servicers to close
a years-long review of mortgage servicers’ foreclosure misdeeds.

Committee Chairman Darrell Issa, a California Republican,
and the panel’s ranking Democrat, Elijah Cummings of Maryland,
sent a letter to the Office of the Comptroller of the Currency
and Federal Reserve today asking for more information about how
homeowners would be affected by a proposed settlement with 14
mortgage servicers, including JPMorgan Chase & Co., Bank of
America Corp. and Citigroup Inc..

“We respectfully request a staff briefing prior to the
conclusion of the reported settlement agreement,” the lawmakers
wrote in the letter. “We would like more information about how
the potential settlement amount is to be determined in light of
potential wrongdoing identified to date, how such aid may be
distributed and in what form, and what may happen to homeowners’
files that are still awaiting review.”

The servicers were ordered by the OCC and other banking
regulators in 2011 to clean up their foreclosure practices and
hire independent consultants to see whether they treated
customers unfairly in 2009 and 2010. Federal regulators are set
to replace that existing victim-by-victim compensation effort
with about $10 billion in flat penalties, according to five
people briefed on the talks who asked not to be named because
the discussions are private.

About 495,000 borrowers applied by the Dec. 31 deadline to
have their foreclosure histories examined for missteps in
response to letters sent by regulators to 4.4 million potential
claimants. Another 159,000 foreclosures were chosen in a
sampling process, according to the OCC. None of the borrowers
have been compensated so far.